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Profit in the Pre foreclosure Market

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Foreclosure Process in 3 Stages

Investing in real estate, specifically foreclosures, is getting a lot of attention right now. Many people are looking to buy a home for their own use or as an investment property. Very few people know how to go about buying a foreclosure, though.
There are 3 stages of foreclosure when you are able to purchase a property at a great deal.

1. Pre foreclosure - This is when the owner is still in their home, but they are behind on their mortgage payments. The owner is in control at this point. Most owners are motivated to sell so they don't ruin their credit rating with a foreclosure.

2. Auction - This phase is different for every state so be sure to check the local regulations. This stage is the most complicated as owners may or may not still be in the home. Usually there are many liens on the property which complicates it further.

3. REO - This is when the bank now owns the property. REOs are the simplest way to buy a foreclosure for new investors. The bank does not do any repairs and the property is sold in as is condition. You will need to do your due diligence in valuing the property and the cost of repairs.

Pre Foreclosure Phase

For now we are going to concentrate on the pre foreclosure phase and how you can make a profit in this market.

With pre foreclosures, the homeowner is still living in the home but for various reasons are behind on their mortgage payments. You can find these owners in several ways. Look in the newspaper at the real estate ads in the For Sale by Owner section or For Sale by Owner websites. Also, you can advertise in newspapers or with flyers that you are looking to buy homes.

Once you find a property you will need to determine if there is equity in the property. This is when the homeowner owes less than the property is worth. You can offer to buy the property for less than the home is worth but for more than they owe. This way the homeowner walks away with a little cash and you can now sell the property for what it is worth and make a profit.

Pre Foreclosure and the Bank

In the case where the owner owes more than the property is worth, you may be able to work with the bank to do a short sale. This is where the bank will accept less than is owed on the property. You would offer the bank less than the property is worth normally because of disrepair so you can sell the home and make a profit. . The owner is able to leave their home with a new beginning, typically with no blemish to their credit record. Most banks will do this as it takes a bad debt off their record and there is no need for the expensive foreclosure process.

With the pre foreclosure market you will need to do your homework on finding the right properties and valuing the properties. There are many courses available to help you make a profit in the foreclosure market. Find out more by clicking on the link below.

Where to start with Pre Foreclosures

With all the information available on pre foreclosures, most people do not know where to start. With Making Fortunes in Real Estate you will learn everything you need to make a profit with pre foreclosures. This course will show you step by step over 4 weeks everything you need to know to start making a profit quickly. You will find information on finding properties, finding investors, how to buy and sell fast and much much more. Get started today!

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Video explaining the Pre Foreclosure Process

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BeckyBW

I love being able to work from home and spend time with my family. Other than family my other favorites are going to movies, auctions, biking,and read... more »

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